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ARTICLE · 04 MARCH 2015

Disguised Software Audit Clauses

Scott & Scott LLP
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Agreements often contain clauses allowing the parties to review books and records, "Books and Records" clauses.

United StatesAccounting and Audit
Brian Kirkpatrick
Brian Kirkpatrick
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Agreements often contain clauses allowing the parties to review books and records, "Books and Records" clauses. These are often boilerplate clauses included in agreements without much consideration from the contracting parties. When a Books and Records clause is used in a software agreement without a software audit clause, it can lead to serious consequences. It is not likely that a major software publisher will use an agreement without a software audit clause, but it is always recommended to review the software audit clause from any publisher. If you do not see one, then look for the Books and Records clause. Such a clause can act as the software audit clause if one does not exist elsewhere in the agreement. Here is a sample of typical language:

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